South Korean Politician Quits Party Due to Involved in Crypto Scandal

Liputan6.com, Jakarta A representative in South Korea’s National Assembly Kim Nam-kuk, announced he would be leaving his political faction amid the growing scandal surrounding alleged cryptocurrency transactions.

In a post on Facebook on Sunday, May 14, 2023 he wrote that he would be leaving the South Korean Democratic Party he loves.

“Today, I leave the Democratic Party that I love. I decided that it is not right to be a burden to the party and party members anymore,” wrote Kim Nam-kuk, quoted from Bitcoin.com, Tuesday (16/5/2023).

Kim was under intense scrutiny after it was revealed he owned around 800,000 Wemix coins by 2021. At that time, the digital asset was valued at around USD 4.5 million or equivalent to IDR 66.5 billion (assuming an exchange rate of IDR 14,790 per US dollar). This was a significant amount not befitting the frugal image that party members had.

On Wednesday, South Korea’s Democratic Party, the main opposition force in parliament, urged Kim to sell assets, a call that was accepted by first-term lawmakers. The party’s ethics committee launched an investigation into its coin trading which has now been suspended.

Alleged Conflict of Interest and Insider Crypto Trading

The South Korean politician reportedly withdrew all of his coins last March, ahead of enforcement of the country’s so-called ‘Travel Rules’. It obliges crypto exchanges to report personal information about crypto owners when the amount transferred exceeds 1 million won.

Critics have pointed out that Kim Nam-kuk’s crypto holdings could create a conflict of interest as he is one of the sponsors of a law that proposes to defer income tax on virtual assets in July 2021.

While Kim has stated there was no malfeasance involved in his trading and has disclosed some of his transaction data, Korean media have also highlighted suspicions over the source of money for his crypto investments and he is suspected of using inside information.